Pieria - Basic Income

Creative destruction, basic income and the jobs of the future. In the 1940s, when the International Harvester M12H tractor made human cotton pickers redundant, hundreds of thousands of Mississippi sharecroppers migrated north and found work on factory assembly lines making tanks, trucks, and cars.

Losing their job on the farm proved no hardship. Backbreaking labour became merely tedious work and union wages transformed the grandchildren of slaves into middle class Americans. And their departure from the plantation had no negative effect on cotton production. Today, a single six-row harvester with a crew of four can pick as much cotton in a day as 1000 people used to by hand. That is how capitalism’s creative destruction is supposed to function. Today, productivity increases are eliminating jobs but so far not creating new and better ones.
Hounding the poor.

The Independent reports that the UK Government is using debt collection agencies to recover overpaid tax credits from some of Britain's poorest families.

In many cases the debts are due to errors by HMRC. And in many more cases they are due to fundamental flaws in the design of the system. Some are due to errors on the part of the claimants. Few, if any, are due to fraud. The tax credits system is complex. The tax credits system is principally designed for people who are in stable long-term employment with a single employer. The most unstable income is that of the self-employed. Tax credits, like self-employment taxation, are based on estimated earnings.
Categorising the poor. I have been meaning to write this post for a long time.

It's the history of what we might call a “British disease” - the desire to judge people's motives rather than addressing their needs. For centuries, successive British social systems have recognised that there are people who cannot work,whether because they are too young, too old, too ill or too infirm. These people need to be provided for by others – in the first instance families, but where family support networks break down, support must be provided by the wider community.
Basic Income and a Room of Ones Own. ﻿Guest post by Dr.

Anna Hedge.
Is America working?
Why inequality matters. Instead, we lefties care about inequality not because we have some idea of what the Gini coefficient or share of the top 1% should be, but because we fear that three things that would make inequalities tolerable are - to some extent - missing.

Firstly, inequalities don't all arise from fair processes. One condition here - set out in Rawls' difference principle - is that inequality should be associated with "fair equality of opportunity". But this condition is obviously lacking when top jobs go disproportionately to people from the most expensive schools. Also, many inequalities arise not from free market processes but from what Acemoglu and Robinson call extractive institutions - the ability of the rich to use political power to extract wealth for themselves*. The state, through crony policies such as bank bailouts, generous procurement schemes, corporate welfare policies and intellectual property laws is complicit in this.
An Experiment with Basic Income. In 1795, the parish of Speen, in Berkshire, England, embarked on a radical new system of poor relief.

Due to the ruinous French wars and a series of poor harvests, grain prices were rising sharply. As bread was the staple food of the poor, rising grain prices increased poverty and caused unrest.
Moral Aspects of Basic Income. In the sweat of thy face shall thou eat bread.

Genesis 3:19. The perils of a Living Wage. Guest Post The discussion surrounding a Living Wage, prompted by falling real wages over the Great Recession, continues apace in the press.

Yet what concerns me about these efforts is not the aim, which is highly laudable, but the potential trade-off between unemployment and underemployment. Let me first define my terms.
How Basic Income Will Save Capitalism. If it were just a safety net for the poor or even a way of lessening inequality, I doubt a guaranteed basic income policy would ever come to pass.

Worthy programmes that help the poor aren’t an easy sell these days. Indeed, advocating them is generally seen as a sign of naïveté. Nonetheless I am convinced that in the not too distant future, all the major advanced capitalist economies will adopt some form of basic income guarantee.
Basic Income and the Atavistic Appeal of Austerity. Today, Basic Income, the proposal that the government provide each and every citizen an income sufficient to meet his or her minimal needs, sounds utopian, maybe even ridiculous.

Soon it will merely seem impractical and a little later, it will be recognised as obvious, inevitable and necessary, not because it will provide a safety net for our poorest citizens or even reduce inequality, worthy as those goals are, but rather because it creates demand, the only thing our economy currently lacks. Basic income may well prove to be the best tool to preserve our capitalist system. These days capitalism and technology have made us so efficient that creating goods and services requires ever less labour. A dozen workers can make steel it used to take hundreds to produce.

Three men and a tractor can pick as much cotton as 1000 sharecroppers.
Basic income vs capitalism. On the one hand, the merits of a guaranteed income for all seem clear: - It would be simple to administer, which should appeal to governments wanting to cut "wasteful" public spending. - In giving an unconditional income to all, workers would be able to take on insecure jobs, training, internships or zero-hours jobs without fear of losing their benefits. In this sense, A BI underpins the flexible labour market.
The wastefulness of automation.

Chris Dillow observes that "one function of the welfare state is to ensure that capital gets a big supply of labour, by making eligibity for unemployment benefit conditional upon seeking work.
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